ur an angel!
omg thanks so much.
regards
jest
Technical Analysis Fallacy
- #2,041
- Mar 27, 2008 9:43pm Mar 27, 2008 9:43pm
- Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
- #2,042
- Mar 27, 2008 10:26pm Mar 27, 2008 10:26pm
- Joined Apr 2007 | Status: (Latin: statūs), rank, state | 3,127 Posts
- #2,043
- Mar 27, 2008 11:02pm Mar 27, 2008 11:02pm
I'll post later on over the weekend how I've been trading it so we can compare.
GREAT!Would leighswww or fti or any of the oldtimers in this thread care to give an example say for a 100k account?
- how would we plan the MM?
- What is the max risk?
- how do we plan our scaling (attack and rescue)
- what are the preffered sequences depending on PA.
I noticed in a previous post you made that you had a $100k account. What I would suggest to you is that unless you are earning interest on that $100k, that you don't keep all that in your trading account.
When you study my spreadsheet, you will see that you do not need all that much money to trade efficiently, so I would recommend that you leave only $10k in your account, put the rest in an interest bearing vehicle, and enter $2,500 for your starting Account Value for the spreadsheet.
OR if you prefer, you can leave $20k and enter $5,000 for your starting Account Value.
Go ahead and change the starting Account Value in one of the "Hypothetical" scenarios and see if you aren't blown away by what you still can do with that small amount of your money, lol.
However, if you're at a broker who requires a minimum of $100k than I guess you have to leave it, but you still should only enter $5,000 for the starting Account Value in the spreadsheet.
You know what, I should figure out a #6 Lot Entry Sequence for you, cuz with your deeper pockets, that would be even safer MM, cuz then you would have TWO rescue-ONLY sequences in which you DO NOT use unless forced to (but it will give you tremendous peace-of-mind at having them available), and that would be an optimum safe/conservative MM but yet still calculating on 4 sequence Lot Entries for profit taking (so the numbers on the scenario projections wouldn't change).
With those of us with smaller accounts, we don't have the luxury of having 2 emergency rescue columns, cuz we don't have enough troops to allocate toward them, but for those, like you who do, that is really the BEST MM possible (in my opinion).
I'll create another spreadsheet for those, like you, who have deeper pockets and can allocate enough troops for a 6 Lot Entry Sequence column.
The main reason I created this spreadsheet was to assist and show the little guys (without deep pockets) how we can still make a good living trading the forex with a small investment. But, if it helps you guys with bigger accounts, too, that's great!
I know compounding is not new and others have probably gotten excited by the concept, however it's the consistency in making winning trades that was always probably the difficult part to making the compounding work as projected.
With fti's method of reaveraging, we have more chances of successful and consistent winning trades, thus it's not impossible or far-fetched to do what is projected on my spreadsheet's Hypothetical scenarios.
The Hypothetical scenarios will help to give people a goal/target to shoot for, as well as a guide for Lot Entry Sequence. If we can consistently bank a minimum of 15 - 20 pips per trade, at the end of 240 trades, we would have increased our accounts significantly ... well, you can see the numbers in the spreadsheet, lol.
I show also that if you withdraw half the account at certain intervals only (when the account hits $10K, then $20K, etc.) you can created a good income and still have enough in the account to continue the compounding effectively.
Withdrawing too early or too frequent will affect compounding significantly, but you also must take your profits out periodically, as well
- #2,048
- Mar 28, 2008 7:00am Mar 28, 2008 7:00am
- Joined Sep 2006 | Status: Chasing Trends | 2,339 Posts
Okay, I tried to create a 6 Lot Entry Sequence, however unless you can count/add the #5 Lot Entry Sequence in the "Lots Traded" for profit taking, this won't give you a decent income.
Sorry, jest.
Thats allright, your contribution here has been immense. I can't create words on how to describe your willingness to go the extra-mile. I will do as noted, like you i have an account with efx, a small one tho,(im still a little skeptical abt having my monies far away from me esp the situation with US Banks).
Will do as you suggested, say a 10k acc and let see how she grows. Im still very much practising the dance like what many here are doing. I like hypo 1 and 2.
- #2,050
- Mar 28, 2008 8:01am Mar 28, 2008 8:01am
- Joined Feb 2008 | Status: Cartographer | 1,981 Posts
Empty as water and soft as a facing wind mountain
- #2,051
- Mar 28, 2008 8:08am Mar 28, 2008 8:08am
Doremi.
If you follow luSans methods you wont go far wrong.
Remember to confirm your direction of entry with a higher time frame & don't attempt a rescue until you see an about turn (reverse).
AT this moment in time ( 08.05 GMT )I have just banked 51 pips trading EUR/USD short confirmed by hourly, I still have my scout out in the market and he is making good progress, I will average in as each small retrace takes place & average out on each stall in momentum.
Find your own way from fti's postings, he is truely a good tutor.
For myself I do use one or more the MA's mentioned in the above postings, to these I add fib levels, this works very well for me because as yet I don't have the full confidence to trade completely naked.
Take care, the market can be a beast.
Regards.
BabeFX.
I am wrong until the market proves me right. (POP Phantom of the Pits).
Thank you for the encouragement. I dance completely nude and beginning to like it.....no unnecessay distractions. BTW can you explain in more details as highlighted in red above? Yes, ur right.....FTI is a great tutor.
The only thing which I'm sceptical is the stop loss....There's one occassion whereby my phone line got problem and by the time it was fixed the next day my account was totally wiped out.....luckily it was a micro account. Just my opinion....for those that trade without any stop loss(Sorry, FTI, I’m not against it)
…… plse ensure you've a backup connection and don't end up like me. Plse be reminded
- #2,052
- Edited 9:14am Mar 28, 2008 8:45am | Edited 9:14am
- | Commercial User | Joined Jan 2007 | 1,486 Posts
Hi BabeFX,
.................................
The only thing which I'm sceptical is the stop loss....There's one occassion whereby my phone line got problem and by the time it was fixed the next day my account was totally wiped out.....luckily it was a micro account. Just my opinion....for those that trade without any stop loss(Sorry, FTI, I’m not against it)
It is not just the phone line that you can cause you a big problem. I have had:
1. Phone line down.
2. Internet Service Provider down.
3. PC crashed - Software.
4. PC Monitor died.
5. PC crashed - hardware (in my case the system board, but could just as easily been disk failure).
6. Power cut. We have had 5 in my street in the last 12 months (one just after I entered a trade) , and I live in England.
7. Broker server outage - just a brief one, but in a fast moving market that is enough.
So as well as always having my mobile phone with my broker's dealing desk number at the ready ( and a torch at night, I try to always remember to put at least a catasrophic stop loss on all trades (could be up to 300 pips or so).
Am I paranoid?
Perhaps, but only a little!
Ian
- #2,053
- Edited 11:02am Mar 28, 2008 10:43am | Edited 11:02am
- Joined Mar 2007 | Status: Pip pip | 2,692 Posts
- #2,055
- Edited 3:07pm Mar 28, 2008 1:47pm | Edited 3:07pm
I'm still trying to understand Leighs system. She goes in small but the last one is fairly agressive. As a boxer it would be Jab, Jab, Swing, Knockout. However, if the market ducks the knockout punch, the position could be at severe risk. Leigh, perhaps you can clarify the reasoning for it?
I had sorta adapted fti's sequence that he posted here --> Post 1462
That would be Hypothetical 1 in my spreadsheet --> .1, .1, .2, 1.6, (6.0) (which is just a fractional version of his sequence --> 1, 1, 2, 16 shown in his example).
For my own actual trades, I am using Hypothetical 5 --> .1, .1, .2, 1.2, (5.6)
The last number in the sequence (which I show in parentheses) is ONLY used for emergency rescues. However, the other previous sequences (#3 & #4) can also used for rescue situations.
If you look at my formulas, you will see that #3, #4 & #5 Lot Entry Sequences are always a calculation that can do a rescue of the previous troops already in the battle.
Try changing the Hypothetical # (located on the bottom of the "Lot Entry Sequence" section) on the "Actual Trades" sheet. As you change the numbers to reflect each Hypothetical scenario's example sequence, look to the right at the #4 Rescue Reaveraging and #5 Rescue Reaveraging tables. You will see how many "Pips from B/E" you will be if you needed to conduct a rescue using either the #4 Lot Entry Sequence and/or the #5 Lot Entry Sequence. I have the default set to being 30 and 40 pips away, but you can change the prices to whatever you want (like if you wanted to see how many pips to B/E at 50 or 100 pips away - hopefully, though, you can conduct the rescue earlier than having to be that far away).
You can use the farthest right "Rescue Reaveraging" table to enter both the Price and # of Lots for custom lot amounts, where the two tables to the left of that have formulas which auto-calculate the # of Lots used in the Lot Entry Sequence, so don't touch those (again, you can only enter data/input in COLORED cells, leave the white cells alone, unless you want to edit the formulas).
Depending on which Hypothetical scenario sequence you choose, the formulas calculate so that #4 and #5 sequences can conduct adequate rescues.
But, I also use the same sequence for attack mode, as well (as in fti's example post I linked above).
Again, this depends on how one dances, cuz if you put your #4 Lot Entry Sequence in and the PA ends up going the opposite way substantially, then you have one chance to rescue it with #5 Lot Entry Sequence.
This is why, everyone needs to first learn to dance well.
My sequences may seem like they are aggressive, however you have to remember that I am using fractional lots, thus it's not as bad as it may seem. Even if you have a larger capital account to work with, I would recommend using fractional lots to begin with, and I explicitly state in my instructions to always enter a starting Account Value LESS than your actual account capital for safest MM.
If you're used to using full lot sizes, then you'd have to get used to using fractional lot sizes to use my spreadsheet. I know it may seem slow and small to use fractional lots, however look at the bottom of each Hypothetical scenario and you will see that your account will grow quite substantially if you build it steadily and consistently.
Example: for Hypothetical 5, at the end of 240 trades (approx. 12 months if trading once a day), I will have withdrawn $90,000 (granted I follow my "Withdrawal" example) and still have a trading account value of $77,427.20 to keep in for compounding more trades. My total profit would be $166,227.20. What's the ROI on that having started with an account value of $1,200?
So far I am on track (actually ahead, since I am normally banking more than the minimum 20 pips used in the Hypothetical 5 scenario - 8 trades have averaged 34.63 pips each troop), so let me keep quantifying my results to see how this pans out in the end. If I can keep this up and average at least 30 pips per troop/per trade, then after 240 trades, here's those statistics:
Withdrawal = $790,000.00
Profit = $1,251,779.20
Account Value (after Withdrawals) = $462,979.20
ACK, I will faint if I do that in reality!
: (so get the smelling salt ready, haha)Since some may prefer separate attack and rescue sequences (like you and luSan), let me try and work on a spreadsheet that caters to that style/system. It's more in line with fti's teachings anyway, so for those of you with larger accounts to work with, it might work for you better (although I think fti uses more aggressive models for himself, lol).
As I am writing this, I am envisioning how I will do it, so I'll be back when I get something useful for you. I'll use the 1, 1, 2, 3, 5, 8 progression for attack, and give option to select from several good rescue sequences.
Again, I would still recommend using fractional lots (so that's what I am going to code my formulas using), cuz it's much safer and although it builds slowly in the beginning, it starts to snowball quite fast after that. Again, study my Hypothetical scenarios and you will see the possibilities/results.
Will do as you suggested, say a 10k acc and let see how she grows. Im still very much practising the dance like what many here are doing. I like hypo 1 and 2.
You might want to use the same spreadsheet that I will be tailoring for Zoran and luSan, so once I finish it, give it a test drive and see if you might like it better
- #2,058
- Mar 28, 2008 10:09pm Mar 28, 2008 10:09pm
I did consider longer timeframes at one point but I was obviously still blind at that time.
So while I'm still on the motorway, the 5min seems to be the speed of the traffic. Our brains can process it fairly well so lets say we are doing 70mph. Go to the 1min and everything speeds up so while most others are doing 70mph we are speeding at 200mph and out reaction time will not be as good so accidents are more likely.
Now if we go to the 4hr or daily, we are now doing 1mph. Who has the patience to sit and watch at that speed? What happens if your entry comes whilst sleeping in the back seat?
So my point is to dance at a comfortable speed and that seems to be the 5min for me.
- #2,059
- Mar 28, 2008 10:25pm Mar 28, 2008 10:25pm
- Joined Feb 2008 | Status: Cartographer | 1,981 Posts
Your comfortable speed for GJ @ 5M sounds like driving at Formula One Circuit......50-100 pips movement.......not the comfortable speed for the faint hearted.
Empty as water and soft as a facing wind mountain
- #2,060
- Mar 28, 2008 10:45pm Mar 28, 2008 10:45pm
I do EUR/USD because of 0.9 pip spread. What is the benefit of GJ? It does have a much higher spread: 3 pips. High volatility has a benefit...more opportunities for entering and exit, right?
I agree with you dancing naked with EU (low spread..but mine is 3
)...slow dance.....easier to learn how the market sway.....I've been watching your thread......you're a fast learner......As for GJ (9 pips spread ) is not recommended for newbie like me......more suitable for seasoned traders....